41 and retiring in the next few Months

[siamamerican]

Probably going to get ridiculed and to be honest, it is probably deserved. Well, I'll get on with my story. I'm 41 and have had an adventurous life. After graduating from college, I went to work at a bank until I got the travel bug. The ensuing 13 years I spent more time traveling than working, but always landed on my feet. At 36, I returned from a 4 year rode trip with only 10k in saving and realized it was time I grew up a tad. It wasn't easy at the start and took more resolve than I thought I possessed not to hit the road when I had the savings to travel for a few years.


In the last 6 years, I went from pool cleaner to a successful VP. It wasn't all fun, especially the temporary pool cleaning gig. Looking back, the pool cleaning is probably where I grew the most. I realized that good things ( traveling ) came with a professional and financial cost. The last 4 years I've saved 100k plus each year and currently have 500k in savings. Last year I was 90% invested in stocks, but all my money is now in saving accounts earning 3-5%. I plan on getting back into stocks, just not now.


Here is the crazy part; I plan on retiring and living a simple life in one of the countries I passed through while traveling. The wife (no kids) is also ready. I currently make about 250k and spend 50k annually.


While traveling, earlier this decade, I spent about $1,200 per month and lived quite well. Actually better than I do now. The cost of living has gone up because of the dollars demise and inflation. I plan on budgeting $1,500 - $2,000 per month, which would include health insurance.


In a couple years, I can see the wife and myself doing something to earn a little extra cash. By my calcs, I think I can make it work without the money, but bad things happen and the cash would give me a little cushion. Might even return to the states and work some more.


Well, that is my crazy story.

 

[Sarah in SC]

Siam, you are not alone in your situation. There are quite a few PTs (perpetual travelers) that participate on our boards, including Billy and Akaisha and a number of folks that live in lower cost of living countries in order to make their FIRE budges go further.

It should be refreshing to find folks that think your savings rate and travel plans are "typical" instead of crazy! We are glad to have you here with the rest of the insane savers, travel bugs, and early retirement planners!

What country or countries do you and and the wife plan to see after you quit? Are you planning to own a home or rent in the places you want to stay?

Health insurance costs are sometimes the biggest surprise to early retirees--do you think that you'll need to budget more for that as you get older? We have some fellow forum members who have been really shocked at how the rates have escalated. Since I'm still working, I don't have to face shopping rates yet, but it is the one big unknown in our FIRE budget.
Again, welcome and thanks for sharing!

 

[socca]

Well, with no kids involved, you've got a lot more flexibility - the only injury you can do is to yourselves. $500k does seem miniscule to me, especially since you're giving up a job that gives you excellent positive cash flow. Well, we're all wired differently, and necessity will be the mother of invention...

Good luck!

 

[retire@40]

Sounds like in a year or two, you should be at your 4% SWR, assuming you are invested in something other than 3% to 5% bank accounts.

Not sure where you are going to live, but inflation is the bogeyman.

Then again, you might find [-]a job[/-] an enjoyable activity for pay in your new exotic destination. Semi-retirement in a fun location is a great option.
I knew someone who retired and earned enough in tips from placing umbrellas on a private beach just a few hours a day during 2 months in the summer to pay for 6 months of living expenses.

 

[siamamerican]

Thanks for the welcoming replies. Don't participate in actively in many internet forums. Actualy, this is the second forum I posted on. Quite impressed with the positive responses.

What country or countries do you and and the wife plan to see after you quit? Are you planning to own a home or rent in the places you want to stay?
Health insurance costs are sometimes the biggest surprise to early retirees--do you think that you'll need to budget more for that as you get older?

Plan on traveling for 3-6 months in the Americas and then heading over to SE Asia. Lived there as a young kid and spent 4 years in Thailand in the 90s. Thailand will be my home for at least the next few years.

Health care is a concern and have looked into Thai health insurance. I'm healthy, but accidents and unexpected health issues have plagued me before. While living in Thailand a car hit me head on while on my bicycle. I was uninsured at the time and paid for the all the surgeries and the month long stay in the hospital. Insurance for both of us will run about $125 per month and increase by roughly $50 every 10 years.

$500k does seem miniscule to me, especially since you're giving up a job that gives you excellent positive cash flow. Well, we're all wired differently, and necessity will be the mother of invention...

No argument here - $500k isn't a large nest egg, but enough to meet my needs. Plan on investing 80% in stocks and the remainder will be an interest bearing savings account. I've lived quite well off less than the $1.5 -2k that I have budgeted. Money goes much further in many SE Asia.

Sounds like in a year or two, you should be at your 4% SWR, assuming you are invested in something other than 3% to 5% bank accounts.

I knew someone who retired and earned enough in tips from placing umbrellas on a private beach just a few hours a day during 2 months in the summer to pay for 6 months of living expenses.

The last 4 years at my current job have been incredible financially, but the current situation is very dire. The financial crisis has not been kind to my employer and I recently volunteered to leave. My 500k saving doesn't include the severance package I'll receive if my wish is granted.

I'll most likely start networking in Thailand and will probably work if the right opportunity presents itself.

Thanks again for the replies

 

[tomintucson]

Hello siamamerican,

Welcome! Like a number of other posters on this board, I have a little first-hand experience in Thailand. Minimal, just a month of travel in the north. But I'm curious about where you lived in the past, where you would prefer to live now, etc. Also, are you ethnically Thai, or farang? I'd love to hear more about your experiences and perceptions.

Tom

 

[siamamerican]

Hello siamamerican,

Welcome! Like a number of other posters on this board, I have a little first-hand experience in Thailand. Minimal, just a month of travel in the north. But I'm curious about where you lived in the past, where you would prefer to live now, etc. Also, are you ethnically Thai, or farang? I'd love to hear more about your experiences and perceptions.

Tom

Hey Tom,

Currently in N. California and grewup in your home state. Graduated from AZ State. I'm a a farang ( Thai for tourist ) - my login name is a little deceptive. You probably spent some time in Chiang Mai, where I lived for 3 years. Spent another year touring SE Asia on my bicycle.

The Thai people as a whole were great and it was great place to chill. I have few doubts I can enjoy Thailand and not eat into my savings. The challenge is saving more money to travel to other destinations. Probably have to rejoin the employed in some capacity down the road.

 

[FIREd]

Hi Siam,

welcome to the board. Although $500K does not seem like a lot of money for a retirement in the US, it can represent a small fortune in other countries. So if you are sure you can have the lifestyle you want on $1,500-$2,000 a month while living abroad, then I think you are getting close. I will however leave you with a few things to ponder:

1) Are you sure you won't want to come back to the US later on?
2) Have you found a way to smooth out currency exchange rate variations from year to year?
3) You will have to invest your money more aggressively in order to keep up with inflation. IMO, this is especially crucial because your nest egg doesn't have much cushion built in it.

 

[siamamerican]

Hi Siam,

welcome to the board. Although $500K does not seem like a lot of money for a retirement in the US, it can represent a small fortune in other countries. So if you are sure you can have the lifestyle you want on $1,500-$2,000 a month while living abroad, then I think you are getting close. I will however leave you with a few things to ponder:

1) Are you sure you won't want to come back to the US later on?
2) Have you found a way to smooth out currency exchange rate variations from year to year?
3) You will have to invest your money more aggressively in order to keep up with inflation. IMO, this is especially crucial because your nest egg doesn't have much cushion built in it.

All good points and I've given them all some thought.
1. There is a good chance I might return to the states to work in the future. If I don't and my investments don't do well, I won't have too many options. I'm OK with the risk. Also, will probably work some wherever I'm at.
2. Can't control the exchange rates, but I can control my budget.
3. I've done extremely well with my investments prior to this year (down 10%). I'm all in cash currently, but waiting for an opportunity to get back aggressively into stocks.